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GAO-08-830R:
United States Government Accountability Office:
Washington, DC 20548:
May 30, 2008:
Congressional Committees:
Subject: Defense Management: Assessment of the Reorganization of the
Office of the Under Secretary of Defense for Policy:
This letter formally transmits the attached briefing in response to
section 957(a) of the National Defense Authorization Act for Fiscal
Year 2008 and the accompanying conference report. The act required the
Comptroller General to conduct an assessment of the most recent
reorganization of the Office of the Under Secretary of Defense for
Policy.
We are sending copies of this report to the appropriate congressional
committees. We are also sending copies to the Secretary of Defense and
the Under Secretary of Defense for Policy. This report will also be
available at no charge on our Web site at [hyperlink,
http://www.gao.gov]. Should you or your staff have any questions
concerning this report, please contact me at (202) 512-3489 or
pendletonj@gao.gov. Contact points for our Offices of Congressional
Relations and Public Affairs may be found on the last page of this
report. Key contributors to this report were Margaret Morgan, Assistant
Director; Renee Brown, Natalie Chaney, Elizabeth Curda, Julia Matta,
Kathia Niewiadomski, Sarah Veale, Elizabeth Wood, and Deborah
Yarborough.
John H. Pendleton:
Director, Defense Capabilities and Management:
List of Congressional Committees:
The Honorable Carl Levin:
Chairman:
The Honorable John McCain:
Ranking Member:
Committee on Armed Services:
United States Senate:
The Honorable Daniel K. Inouye:
Chairman:
The Honorable Ted Stevens:
Ranking Member:
Subcommittee on Defense:
Committee on Appropriations:
United States Senate:
The Honorable Ike Skelton:
Chairman:
The Honorable Duncan L. Hunter:
Ranking Member:
Committee on Armed Services:
House of Representatives:
The Honorable John P. Murtha:
Chairman:
The Honorable C.W. Bill Young:
Ranking Member:
Subcommittee on Defense:
Committee on Appropriations:
House of Representatives:
[End of correspondence]
Briefing:
Assessment of the Reorganization of the Office of the Under Secretary
of Defense for Policy:
Briefing for Congressional Defense Committees:
May 30, 2008:
Introduction:
In September 2006, the Department of Defense (DOD) announced a
reorganization of the Office of the Under Secretary of Defense (OUSD)
for Policy.
The reorganization was intended to provide more comprehensive policy
oversight for the nation's security challenges by realigning the
organization to reflect current security priorities.
Concerned about the basis for these changes and their potential effect
on policy oversight for critical national security concerns, Congress
required in the National Defense Authorization Act for Fiscal Year 2008
that GAO evaluate the overall approach and implementation of OUSD
Policy’s reorganization and provide its assessment. [Footnote 1]
The conference report accompanying the 2008 defense authorization bill
directed that GAO also assess several human capital management issues
related to the reorganization. [Footnote 2]
Key Objectives:
1. What were the goals for OUSD Policy’s reorganization and what is the
status of implementation?
2. To what extent did OUSD Policy employ key practices of successful
transformation in its reorganization?
3. What challenges, if any, remain for OUSD Policy after the
reorganization?
Appendix I contains our summary of the specific OUSD Policy
reorganization issues that were identified in the National Defense
Authorization Act for Fiscal Year 2008 and the accompanying conference
report, for example:
* broadening the portfolios of certain assistant secretaries, and;
* assigning staff under the new organization.
Methodology:
* Examined documentation related to the development and implementation
of the reorganization.
* Compared OUSD Policy reorganization plans to key practices in
organizational transformation and strategic human capital management
identified in previous GAO work.
* Discussed perspectives about the reorganization process,
implementation, benefits, and challenges with DOD officials and
internal and external stakeholders, such as U.S. Northern Command, U.S.
Special Operations Command, and the Department of State.
* Conducted reviews of OUSD Policy documents and interviewed key OUSD
Policy officials to gather detailed information about the specific
reorganization issues identified in the National Defense Authorization
Act for Fiscal Year 2008 and the accompanying conference report.
* We performed our review from October 2007 through May 2008 in
accordance with generally accepted government auditing standards.
Summary:
* The Secretary of Defense announced the reorganization in September
2006 and established several key goals; OUSD Policy completed the
reorganization in August 2007.
* OUSD Policy’s development and implementation of its reorganization
addressed key practices associated with successful organizational
transformations.
* OUSD Policy continues to reexamine and refine the organization;
however, it faces several challenges related to the overall
effectiveness and efficiency of the office, such as:
-Developing performance measures to assess progress in achieving goals.
-Balancing workforce needs to support the organization’s missions.
Objective 1: Goals for OUSD Policy’s Reorganization:
Key goals for the reorganization were to:
1. Realign OUSD Policy with current security priorities, including
fighting the Global War on Terrorism.
2. Create more adaptability to provide policy oversight for emerging
threats to national security.
3. Balance the responsibilities of the Assistant Secretaries of Defense
(ASDs).
4. Establish a focal point in OUSD Policy for each Combatant Commander.
Objective 1: Implementation Status:
Status: The Secretary of Defense announced the reorganization in
September 2006 and OUSD Policy completed the reorganization in August
2007.
Key changes:
* Broadened the responsibilities of the ASD for Special Operations/Low
Intensity Conflict by adding policy oversight for strategic
capabilities and general purpose forces.
* Balanced regional responsibilities across three ASDs to manage the
development, coordination, and implementation of DOD security policy.
* Created a new ASD for Global Security Affairs to provide oversight
for crosscutting issues such as building long-term relationships with
new strategic partners.
Figure 1 and appendix II contain detailed information about OUSD
Policy’s organizational structure.
Figure 1: OUSD Policy Legacy and Current Organizations:
[See PDF for image]
This figure contains two organizational charts, as follows:
Legacy Organization:
Under Secretary of Defense (Policy):
* Principal Deputy Under Secretary of Defense (Policy):
- ASD International Security Affairs;
- ASD International Security Policy;
- ASD Special Operations/Low Intensity Conflict (SO/LIC);
- ASD Homeland Defense.
Current Organization:
Under Secretary of Defense (Policy):
* Principal Deputy Under Secretary of Defense (Policy):
- ASD International Security Affairs;
- ASD Asian and Pacific Security Affairs;
- ASD Homeland Defense and Americas' Security Affairs;
- ASD Global Security Affairs;
- ASD SO/LIC and Interdependent Capabilities.
[End of figure]
Objective 2: Key Practices for Successful Organizational
Transformation:
OUSD Policy’s reorganization efforts addressed the key practices GAO
previously identified for successful transformation. [Footnote 3] These
key practices support building a world-class organization.
1. Ensure top leadership involvement in the transformation-Top
leadership defined compelling reasons for change and remained highly
involved during implementation.
2. Establish a coherent mission and integrated strategic goals-OUSD
Policy’s draft strategic management plan included mission, vision, and
goals that were used to guide the reorganization.
3. Focus on a key set of principles and priorities-Senior leadership
identified detailed priorities intended to guide the reorganization and
revitalize the workforce culture.
4. Set implementation goals and a timeline to show progress-OUSD Policy
established high-level implementation goals and a three-phase timeline
for the reorganization.
5. Dedicate an implementation team to manage the transformation
process -OUSD Policy’s implementation team managed the day-to-day
operations during the reorganization and engaged DOD and external
stakeholders to discuss plans.
6. Use the performance management system to define responsibility and
assure accountability-OUSD Policy identified the skills and
competencies for its action officers and aligned employee performance
objectives with organizational goals.
7. Establish a communication strategy to share information-OUSD Policy
communicated change to internal and external stakeholders through a
strategy of varied, customized activities such as sending e-mails from
top-level leaders, conducting town hall meetings, and launching an
intranet site for the reorganization.
8. Involve employees to obtain their ideas-OUSD Policy incorporated
employee feedback into new policies and procedures, such as having
support staff coordinate visits with OUSD Policy and foreign officials.
Objective 3: Challenges:
OUSD Policy continues to reexamine and refine the organization through
quarterly meetings with senior leaders, such as the Deputy Assistant
Secretaries of Defense (DASDs); however, it faces several challenges
related to the overall effectiveness and efficiency of the office.
These challenges include:
* Defining clear metrics to evaluate progress toward goals:
- Before and after the reorganization OUSD Policy developed some
organizational performance measures such as external (the Secretary of
Defense) and internal (action officers) customer satisfaction.
- OUSD Policy established the Organizational Performance Measurement
Board to develop performance measures and to assess progress in
achieving goals.
- OUSD Policy is developing performance measures in the absence of a
strategic plan that identifies missions and goals.
* Developing workload measures to assess staffing needs in each office
so that workloads are balanced among offices and individuals and
resources are dedicated to highest priorities:
- OUSD Policy did not use workload measures to assign the number of
action officers to each DASD in the legacy and current organizations,
although it operates under a limitation for the number of civilian and
military personnel employed in the Office of the Secretary of Defense.
- To stay within the limitation, OUSD Policy supplements its workforce
through contractors and several types of governmental employees.
- According to several OUSD Policy officials, more staff are needed in
some of the organization’s offices to perform required tasks.
Agency Views:
We obtained oral comments on a draft of this briefing, and the agency
agreed with the facts presented. On the basis of the comments, we made
technical changes as appropriate.
GAO Contact:
Should you or your staff have any questions on the matters discussed in
this briefing, please contact John Pendleton at (202) 512-3489 or
pendletonj@gao.gov.
[End of section]
Appendix I: Issues in the National Defense Authorization Act for Fiscal
Year2008 and accompanying conference report and summary of
observations.
Authorization Act and conference report issues:
The manner in which the reorganization of the office furthers, or will
further, its stated purposes in the short-term and long-term, including
the manner in which the reorganization enhances, or will enhance, the
ability of the DOD—(A) to address current security priorities,
including on-going military operations in Iraq, Afghanistan, and
elsewhere; (B) to manage geopolitical defense relationships; and (C) to
anticipate future strategic shifts in those relationships.
Summary of Observations:
(A) OUSD Policy established the DASD Coalition Affairs, whose
responsibilities include equipping and training needs for U.S.
coalition partners for ongoing operations in Iraq and Afghanistan.
(B) The current organizational structure rebalanced regional
responsibilities to redistribute workload and increase understanding of
emerging regional issues.
(C) OUSD Policy established the DASD Partnership Strategy to, among
other things, anticipate changes in the capabilities of current
international partners and generate workable strategies to increase
U.S. partnerships.
Authorization Act and conference report issues:
The impact of the large increase in responsibilities for the ASD
Special Operations/Low Intensity Conflict (SO/LIC) & Interdependent
Capabilities under the reorganization on the ability of the Assistant
Secretary to carry out the principal duties of the Assistant Secretary
under the law. The possible decrease in attention given to special
operations issues resulting from the increase in responsibilities for
the ASD SO/LIC & Interdependent Capabilities, including responsibility
under the reorganization for each of the following: (A) strategic
capabilities, (B) forces transformation, and (C) major budget programs.
Summary of Observations:
IOUSD Policy changed the missions within the portfolio of the
ASDSO/LIC, such as removing counternarcotics missions and moving them
to the ASD Global Security Affairs’portfolio, and added strategic
capabilities and forces transformation. OUSD Policy also added
Interdependent Capabilities to the ASD’s title. Several OUSD Policy
officials stated that the current mission set of the ASD SO/LIC &
Interdependent Capabilities provides a comprehensive OUSD Policy view
of the total force, allowing the ASD to link strategies and
capabilities. Although oversight responsibilities have broadened, the
duties specified under law, such as overall supervision of special
operations activities, remain within the portfolio of the ASD SO/LIC &
Interdependent Capabilities. Further, the Combatant Commander Special
Operations Command stated that the reorganization had not changed how
the ASD provides oversight for special operations. In the current
organization OUSD Policy has dedicated staff to oversee Major Force
Program 11, the special operations budget, although the total number of
staff providing oversight for special operations programs is fewer than
the number of personnel in the legacy organization. However, OUSD
Policy lacks performance measures to determine the effect of changes
made to the ASD portfolio as a result of the reorganization.
Authorization Act and conference report issues:
The unique placement under the reorganization of both functional and
regional issue responsibilities under the ASD Homeland Defense and
Americas’Security Affairs (HD&ASA).
Summary of Observations:
The ASD HD&ASA is responsible for regional and functional issues,
including countries in the Western Hemisphere and homeland defense
activities. OUSD Policy officials stated that grouping regional and
functional issues provides a more comprehensive view of issues common
to the region, such as border security, and increases the visibility of
Western Hemisphere countries within OUSD Policy.
Authorization Act and conference report issues:
The possible diffusion of attention from counternarcotics,
counterproliferation, and global threat issues resulting from the
merging of those responsibilities under a single DASD for
Counternarcotics, Counterproliferation, and Global Threats. The impact
of the reorganization on counternarcotics program execution.
Summary of Observations:
OUSD Policy lacks performance measures to determine the effect of
changes made to ASD or DASD portfolios as a result of the
reorganization. However, several OUSD Policy officials stated that
networks associated with counternarcotics, counterproliferation, and
global threats typically exploit the same vulnerabilities, such as
unprotected borders, and present similar operational challenges. By
placing counternarcotics, counterproliferation, and global threats in
one DASD, OUSD Policy officials plan to share information and develop
similar approaches to more efficiently counter these illegal
activities. Additionally, the reorganization did not affect the
management or execution of the Central Transfer Account, which is used
for DOD’s counternarcotics program or the Cooperative Threat Reduction
account, which is used for DOD’s counterproliferation program. The
accounts continue to be managed separately.
Authorization Act and conference report issues:
The differentiation between the responsibilities of the DASD for
Partnership Strategy and the DASD for Coalition Affairs and the
relationship between such officials.
Summary of Observations:
DASD Partnership Strategy has responsibility for developing long-term
strategic policies involving partner nations, such as coordinating the
Global Defense Posture, while Coalition Affairs has responsibility for
developing policies related to near-term needs for operational
requirements, such as providing policy oversight for training and
equipping coalition troops.
Authorization Act and conference report issues:
The impact of the process, as conducted in November 2006 and
implemented in early 2007, whereby career civil servants “bid”on
positions within OUSD Policy, on overall levels of personnel morale,
expertise, and effectiveness.
Summary of Observations:
OUSD Policy used a process which allowed foreign affairs specialists to
submit their staffing assignment preferences and allowed DASDs to bid
for employees. Through this process, OUSD Policy filled first
preferences for 77 percent of the action officers. A leadership team
evaluated all action officer staffing assignments to ensure that
consideration was given to certain organizational priorities, such as
retaining expertise in specific offices. However, OUSD Policy did not
develop measures to determine the effect of the staffing process on
morale and effectiveness, and the impact of the staffing process is
unclear.
Authorization Act and conference report issues:
The fact that foreign affairs specialists from those field agencies and
offices associated with OUSD Policy were not included in the personnel
assignment bidding system, even though they are eligible to apply for
vacancies in OUSD Policy.
Summary of Observations:
Foreign affairs specialists in the DOD agency and field activities
within OUSD Policy were not included in the action officer staffing
process for two reasons. First, the agency and field activities have
separate manpower counts within DOD. Second, the total size of OUSD
Policy did not increase from the legacy to the current organization,
thus OUSD Policy placed all legacy action officers in the current
organization before opening vacancies to other DOD employees.
Authorization Act and conference report issues:
Possible absence of a dissent channel within DOD and, in particular,
OUSD Policy that personnel may use to present alternative views,
analyses, and policy recommendations at variance with those in place or
being submitted to senior leadership for consideration.
Summary of Observations:
During implementation of the reorganization, OUSD Policy took several
steps to obtain employee opinions, including establishing an officewide
e-mail address for comments and conducting forums for employees to
express concerns or suggest improvements. In the current organization,
OUSD Policy has taken several steps to manage employees’ concerns such
as creating the Action Officer Committee, which provides opportunities
for employees to express their perspectives. Further, employees may
express their alternative opinions about DOD's views, analyses, and
policy recommendations through OUSD Policy's management structure.
Authorization Act and conference report issues:
The manner in which DOD plans to evaluate progress in achieving the
stated goals of the reorganization and what measurements, if any, the
department has established to assess the results of the reorganization.
Summary of Observations:
OUSD Policy established the Organizational Performance Measurement
Board to assist in the development of performance measures and has
begun collecting data for a number of performance measures such as
external (the Secretary of Defense) and internal (action officer)
customer satisfaction. However, OUSD Policy has not defined a
comprehensive set of measures to evaluate progress toward goals.
Authorization Act and conference report issues:
The extent to which DOD has worked to mitigate congressional concerns
and address other challenges that have arisen since the reorganization
was announced.
Summary of Observations:
OUSD Policy issued a report to explain the key aspects of the
reorganization and drafted a series of memos to provide clarification
about the current organizational structure. In addition, OUSD Policy
officials testified and provided briefings to members of Congress about
the reorganization and other emerging issues.
[End of Appendix I]
Appendix II: Detailed OUSD Policy Organization:
[See PDF for image]
This figure is a detailed OUSD Policy Organizational chart, as follows:
Under Secretary of Defense (Policy):
Enterprise Services;
Policy Planning;
Support for Public Diplomacy;
Principal Deputy Under Secretary of Defense (Policy):
* ASD International Security Affairs;
- Middle East;
- Africa;
- Europe and North Atlantic Treaty organization;
* ASD Asian and Pacific Security Affairs;
- East Asia;
- South and Southeast Asia;
- Central Asia;
* ASD Homeland Defense and Americas' Security Affairs;
- Homeland Security Integration;
- Homeland Defense;
- Crisis Management and Defense Support to Civil Authorities;
- Western Hemisphere Affairs;
* ASD Global Security Affairs;
- Partnership Strategy;
- Coalition Affairs;
- Counternarcotics, Counterproliferation and Global Threats;
- Detainee Affairs;
- Prisoner of War/Missing Personnel Affairs;
- Defense Prisoner of War/Missing Personnel Office;
- Defense Security Cooperation Agency;
- Technology Security Policy;
- Defense Technology Security Administration;
* ASD SO/LIC and Interdependent Capabilities;
- Special Operations Capabilities;
- Strategic Capabilities;
- Stability Operations Capabilities;
- Forces Transformation and Resources.
Source: GAO analysis of DOD information.
[End of figure]
[End of Appendix II]
Footnotes:
[1] Pub. L. No. 110-181, § 957 (2008).
[2] H.R. Rep. No. 110-477, at 979 (2007) (Conf. Rep.)
[3] GAO, Results-Oriented Cultures: Implementation Steps to Assist
Mergers and Organizational Transformations, GAO-03-669(Washington,
D.C.: July 2, 2003).
[End of section]
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